So You Want a 30 Year Loan?

In the year 2044, I will be just eight short years from retirement, and I'll be able to submit my final mortgage payment (provided I send minimum payments and purchase by the end of next year).

2044, difficult to fathom, but a reality one must imagine if they wish to enter the realm of homeowner/landowner (I prefer landowner. I picture rolling hills, horses, and bearded men roaring while wielding skull-bashing axes). When I think about the reality of taking a loan out that could potentially take me 30 years to repay, I cringe. The proverbial kick in the gut as picture myself sending monthly payments of my hard earned cash to a fancy cheese eating billionaire. However, what really makes me cringe is how much money I'm "throwing away" every month as I rent my crumby apartment.

Currently, my fiancee and I pay $1050 a month for a decent living space in Albany Park. Our bone-head landlord, ineffective building manager, and the slack-jawed-crayon-eating-door-slamming-loud-music-playing-slob jerk neighbors make me never want to rent an apartment for as long as I live. I do not want to spend my money to help someone pay off their mortgage, even if it means I am not responsible for taxes or repairs.

Logical, calculated, and practical. Each adjective has described me since about the age of 16. I've never borrowed cash from anyone to pay bills and have never paid a bill late. Every nickel and penny is accounted for during my quarterly budgets and I often start budgeting for Christmas in September. However, I was almost dumbstruck when I came across a calculator on NY Times' website that said I would save over $500 a year after year six of landownership. Not a huge chunk of change, but the savings only grow the longer one stays in their purchased home.We plan on staying for at least 10 year. By year ten, our annual savings increases to $2,300.

Additionally, Trulia has an excellent map that displays if it is cheaper to buy or rent state-by-state. Currently, it is 42% cheaper to purchase a home in my state of Illinois than renting an apartment. This is based on averages of course and can vary neighborhood to neighborhood. I can imagine that the $10,000 foreclosures across the various violence-ridden neighborhoods and farming prone areas are included in this average;therefore, the 42% could be a little skewed say you are currently paying $1000/month rent and looking to buy a $400,000 home in Lakeview. The odds are not in your favor in this scenario.

At the end of the day, my fiancee and I have decided that buying a home is our best and most logical move. Anyone who's interested can keep up to date with our adventure as we navigate through the waters of searching, financing, and ultimately purchasing a home. I hope this blog serve to be informative and if you have questions, definitely post them and I will do my best to give me personal advice.

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